Recent analyses highlight an interconnected pattern of corruption involving nonprofit fraud, forged identities, prison radicalization, sophisticated money laundering, and vulnerabilities in electoral processes. These elements often reinforce one another, exploiting systemic weaknesses to divert resources, enable crime, and threaten security.
Nonprofit Fraud: A Gateway to Larger Schemes
Nonprofits face significant fraud risks, with occupational fraud leading to substantial losses. Smaller organizations are particularly vulnerable to corruption schemes such as billing fraud and payment tampering (PBMares 2025). Median losses in nonprofits reach $76,000 to $85,000 per case, with estimates of annual sector-wide fraud at $40–50 billion (The Charity CFO 2025). High-profile 2025 cases include allegations of diverted federal funds in child nutrition programs and personal misuse of charitable assets, often involving weak oversight and collusion (CharityWatch 2025).
Identity Fraud and Its Role in Enabling Terrorism
Forged or stolen identities facilitate broader crimes, including money laundering, human trafficking, and terrorism financing (UNODC n.d.). Emerging technologies like AI exacerbate risks by enabling false digital identities and impersonation scams (UNODC 2025a). International reports emphasize the crime-terror nexus, where identity-related offenses support organized crime and extremist activities (UNODC 2025b).
Radicalization in Prisons: Turning Criminals into Extremists
Prisons remain vulnerable to radicalization, with overcrowding and poor management aiding recruitment (Council of Europe n.d.). European initiatives focus on prevention, rehabilitation, and addressing jihadist influences in correctional facilities (European Commission n.d.). Inmates exposed to extremist ideologies may adopt terrorist methods post-release, linking common crime to greater threats.
Financial Crime and Trade-Based Money Laundering
Trade-based money laundering (TBML) disguises illicit funds through international trade transactions, increasingly used for terrorism financing (FATF n.d.). Schemes exploit trade complexity, including over- and under-invoicing, to move value undetected (FinCEN 2025).
Echoes in Election Integrity
Allegations of absentee ballot irregularities, such as the 2020 Project Veritas investigation into organized collection in Minneapolis, highlight potential vulnerabilities in voting systems (Project Veritas 2020). Though debated and investigated, such claims underscore the importance of safeguards against exploitation.
Breaking the Pattern: The Need for Vigilance
These interconnected vulnerabilities—weak nonprofit oversight feeding identity fraud, which in turn supports extremism and laundering—form a systemic pattern. With rising digital risks in 2025, enhanced controls, international cooperation, and transparency are critical to safeguard institutions and public trust.
References
CharityWatch. 2025. “Charity Scandals of 2025.” CharityWatch Blog, November 3, 2025. https://blog.charitywatch.org/charity-scandals-of-2025/.
Council of Europe. n.d. “Handbook for Prison and Probation Staff.” https://rm.coe.int/16806f9aa9.
European Commission. n.d. “Prevention of Radicalisation.” Migration and Home Affairs. https://home-affairs.ec.europa.eu/policies/internal-security/counter-terrorism-and-radicalisation/prevention-radicalisation_en.
FATF. n.d. “Trade-Based Money Laundering.” Financial Action Task Force. https://www.fatf-gafi.org/en/publications/Methodsandtrends/Trade-basedmoneylaundering.html.
FinCEN. 2025. “Cornerstone Report: Trade Based Money Laundering (TBML).” U.S. Department of the Treasury, February 2025. https://www.ice.gov/doclib/cornerstone/pdf/cornerstone202502.pdf.
PBMares. 2025. “2025 Nonprofit Fraud Risks | Internal Fraud | Fraud Prevention.” February 26, 2025. https://www.pbmares.com/fraud-risks-in-nonprofits-trends-and-strategies-for-2025/.
Project Veritas. 2020. Various reports on Minneapolis ballot allegations, September 2020.
The Charity CFO. 2025. “3 Types of Nonprofit Fraud to Watch Out for Today.” October 18, 2025. https://thecharitycfo.com/3-types-of-nonprofit-fraud-to-watch-for-today/.
UNODC. n.d. “Identity-Related Crime.” United Nations Office on Drugs and Crime. https://www.unodc.org/unodc/en/corruption/identity-related-crime.html.
UNODC. 2025a. “What to Know About Cybercrime in 2025.” October 2025. https://www.unodc.org/unodc/frontpage/2025/October/what-to-know-about-cybercrime-in-2025.html.
UNODC. 2025b. Various reports on emerging crimes and cyber threats, 2025.
Written with the help of Grok AI. Thanks to the commenters on X who initiated this post idea.
Writing by Dr. Dannielle Blumenthal 